13/07/2017 BBC Business Live


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This is Business Live from BBC News with Alice Baxter and Ben Bland.


Can President Trump make French ties great again?


With pressure over climate change and trade will there be a meeting


Live from London, that's our top story on Thursday 13th of July.


These were the pictures about half an arrogant in Paris whether US


president has just arrived to be guest of honour at France's bastille


day celebrations. Plus free trade with the world's used the economy is


also up for discussion side of the world, with the US saying it wants


to renegotiate with South Korea. The latest from the markets where Asia


extended a bit of a global rally, responding well with some data. Here


in Europe, a bit of a mixed picture. And we'll be getting


the inside track on how one man's made a sparkling success of British


wine, despite the industry being overshadowed by its French


rivals for so long. And as a court rules


on whether checking potential employees social


media is legal, let us know, would you be happy for a recruiter


to look through your social media? In the last hour, the US


President Donald Trump He's there to celebrate the French


holiday of Bastille Day But as the White House put it, he'll


be looking to build on the countries It comes as President Macron told


a French newspaper this his country "must reform its economy


to give it more vigour". The leaders will discuss the EU's


trading relationship with the US, Last year, they sold each other


this: $686 billion worth of goods. The problem for President Trump


is it's tilted in Europe's favour. It runs a surplus with the US -


in other words, it sells more goods to the US than the other way around


- by this much - $147 billion. Which brings us to this:


the Transatlantic Trade Talks on the massive free trade deal


between the EU and US have been suspended since Mr Trump


came to power. The business world will


be watching closely. As it will on this -


the Paris climate change accord - Mr Macron says he will be pressing


Mr Trump to sign up again, Another source of transatlantic


tension - European pressure on the big US tech firms


over tax avoidance. But on Wednesday, a French court


ruled that Google is not liable And there might be


more common ground. Mr Trump has demanded


European members of Nato Mr Macron agrees -


he's pledged to increase France's defence spending to Nato's


target of 2% of GDP, Cloe Ragot is a France


analyst with Eurasia Group, who advise businesses on political


risks. Cloe, a very good welcome to


Business Live. Just before we get onto it, I just wonder, these are


two men, similar back story, the ground in the corporate world who


have then gone on to take the top job in politics but very different


personalities. How do you think that will play out in these discussions?


They both have an interest to actually work together, so I think


despite all the disagreement, as we know, on climate change, on trade,


and also to some extent on defence, I think they will just avoid those


topics and focus, for instance, on, you know, more trade relation, and


also on counterterrorism. One of the things that we touched on just there


was the trade deficit that the US has with the European Union. It has


been a clarion call that Trump has gone back to time and time again,


that he doesn't like these imbalances. What hope do you think


there is, then, of getting him to restart talks on the Transatlantic


Trade and Investment Partnership, a free-trade deal, when there already


exists this imbalance? I think it is actually very unlikely that the


talks will restart while Trump is in power. I think one of the main


platforms actually off is to fight against this tax avoidance, so you


also mentioned Google, it is very unlikely that they would find some


agreements in the short-term. We also mentioned earlier the discord


over climate. Trump very publicly pulled the United States out of the


Paris accord. Macron has been very vocal in his approval and that. --


in his approval of that. Macron hopes he will be able to persuade


Trump to come back into the Paris agreement. However, we actually


don't think that Trump will rejoin the Paris agreement, and that is


exactly also one of the main reasons why it was quite surprising that he


was invited for the 14th of July. 13th and 14th of July in France.


Such an important day in France, yes. Thank you very much, Cloe.


Let's take a look at some of the other stories making the news...


The maker of Havaianas - perhaps the world's most famous


brand of flip-flops - has been sold for $1.1 billion.


The company which owned it is looking to raise cash


after being caught up in Brazil's corruption scandal.


Havaianas are one of Brazil's best-known international brands,


with over 200 million pairs of flip-flops sold per year.


The boss of Qatar Airways says it still plans, despite the US airline


is deciding to terminate the pair's are sharing agreement. On Wednesday


American airline said it was ending its co-share deal with both Qatar


airlines. It said it believed the two were getting a legal state


subsidies, something which they denied.


Irish business leaders have called for a the European Union to provide


a state aid programme worth more one billion euro state aid programme


from the European Union in order to protect Irish firms in the event


The Irish Business and Employers Confederation said that if Britain


left the customs union, it would massively disrupt trade,


Britain is Ireland's largest trading partner,


The US has said it wants to renegotiate what it's calling


a lopsided trade deal with South Korea.


Monaco, tell us more. The news is not much of a surprise to the South


Koreans. The President met with the Trump administration in Washington


just last month, and may walk away with a message that the US felt that


the free trade agreement is not a great deal. South Korea is a major


US economic partner, more than $144 billion of goods and services was


traded between the two countries last year. In 2012, the Obama


administration said the FDA would boost its businesses, but exports


have declined almost 3% since the deal went in effect, and at the same


time imports from South Korean companies have increased by about


23%. The US Trade Minister said yesterday he wants to have talks


with the Moon administration within 30 days, however that might be a


problem for the South Koreans. President Moon is yet to appoint the


top trade post and it may not be filled in time. Thank you, let's


stay in the region. Let's stay in the region now


where some Asian shares scaled They took their cue from Wall Street


which posted record peaks. That followed the testimony of Fed


chief Janet Yellen who sounded more doveish than many had expected -


talking of a gradual approach to tightening as the US continues


to grapple with low inflation. Equities were underpinned


by a drop in bond yields Sentiment also got another boost


when China reported upbeat data Only Japan's Nikkei was somewhat


restrained by a firmer yen Here in Europe, markets have


also opened slightly up. We're expecting news out


from ASOS and Astra Zenica. And Michelle Fleury has


the details about what's ahead One of the major US airlines, Delta,


reported second -- reports second-quarter earnings this


Thursday. Wall Street hopes it will point to clear skies ahead. Last


week, the carrier said its revenue per passion Joe was up, helped by


improving average fares. -- per passenger. The number two US airline


by passenger traffic is expected to post a rise in quarterly profit.


Another company turning in its report card is Cargill. Full-year


results for the privately held global commodities trader are likely


to get a boost, thanks to healthy exports of US beef, but a glut of


global seeds, that is likely to weigh on its agricultural business


division. American central banker Janet Yellin delivers her second day


of monetary policy testimony to the Senate bank committee. On Wednesday


she told US lawmakers that interest rates would not have to rise all


that much further to reach the third's mutual level, and that's


sent stocks and the Dow to record levels.


Joining us is Jane Foley, senior currency strategist at Rabobank.


Janet Yellin's testimony, much awaited, and it has, you know,


caused some movements, as expected. Certainly, and really was the tone


of her comments. The Federal Reserve have been hiking interest rates for


a while and this year they have done it twice, and their official


guidance suggested we would do it again this year and maybe three


times next year, but of course inflation in the year has been


required benign, as in most other countries, apart from the UK.


Yesterday, Janet Yellin gave me a little bit of good news. She sort of


implied that maybe she was a bit more concerned about inflation and


she had previously been, and suggested that maybe they may not


therefore hike interest rates this year. Good the stock markets, good


for risk and that is what the market reacted to. It pushed the Dow to a


record high close. Yes, and softened the dollar a little bit as well. You


are quoted on this story in the FT this morning. Canada, the Canadian


dollar, the Looney, I love that term, rocketing for the first time


in seven years. Again, this Israeli interesting, in the context of all


the developed countries and missed the session of whether they will


hike interest rates more generally. The market was anticipating this,


they had a couple of comments from the governor and the deputy governor


suggesting that they might, but what surprised the market was the


statement that accompanied that interest rate hike, because they


seem to suggest they would do it again, even though their inflation


target is roundabout 2% and then inflation rates are round 1.3. So


they are suggesting what is bearing down in Canada in inflation is


temporary, and interestingly the Fed is saying that as well. But every


country in the GTN, temporary... Inflation is quite benign, but not


at the place had previous economic cycles abroad. See you later to go


through some business papers. We'll meet the man making


a sparkling success of English wine despite the industry


being overshadowed by its I think we get to try some here on


Business Live! Southern Rail owners GTR have been


fined ?13.4m for poor performance. The firm has experienced waves


of industrial action on its Southern rail route over the past year,


much to the continuing Theo Leggett is in our


Business Newsroom. Fiola, tell us more. OK, well, as


anybody who has travelled on southern over the past year has


known it has had a pretty rough time of it. 58,000 services or


thereabouts were cancelled last year, and on various occasions the


network came almost to a grinding halt. The biggest factor in that was


a dispute between GTR and train staff. The unions, who claimed that


the company's attempts to try and make drivers responsible for opening


and closing doors and changing the role of conductors was unsafe. That


was the biggest factor in all the delays. There were others. What the


government has been doing is examining whether or not GTR was in


breach of its franchise agreement, and they have imposed this fine of


?13.4 million, and suggested at the same time that, although there were


problems at Southern, most of them or not the franchise operator's


fault. And therefore the fine could have been a lot higher, if they


decided that the industrial action and all that kind of thing was the


responsibility of the franchise holder. It appears they have decided


that is the case. Is that is why Southern has been penalised, but


what response has there been to this decision? It will come as a relief


to the majority owners of GTR, go-ahead group. Have a look at this


graph, in February they issued a profits warning and the share price


came crashing down. That profits warning was largely due to problems


at Southern. So for go-ahead group to get this behind them, and to say


that it could have been a lot worse, that is good news. Obviously the


unions are taking a different viewpoint. The RMT has come out and


said this is a whitewash. Consumer groups don't seem too happy about it


either. Plenty more on the website. It is


updated throughout the day. The story on the other moment, Mike


Ashley of Sports Direct, he has bought a 25% stake in computer


gaming group. Two weeks ago, shares plunged after issuing a profit


warning. You can read all about it on the business pages online. You


are watching Business Live. The US president has just arrived in France


where trade will feature heavily in his talks with President Macron.


Markets have just opened in Europe. A mixed picture. Not necessarily


following the global rally we saw in Asia overnight.


The thought of wine probably conjures up images of vineyards


But increasingly wine from Britain is starting


The English wine industry grew 16% between 2015 and 2016


with revenues rising to $170 million.


By comparison, French wine sales exceeded $13 billion in 2015.


We're joined by Charlie Holland, CEO and head winemaker


Very warm welcome. Thank you for having me. Particularly warm welcome


as you have brought some sparkling wine with you! I will try and do


this without making a mess. No one is watching! We mentioned in


the introduction that as an English winemaker, do you feel there is a


snobbery about your product? Are people asking, why would I buy


English when I can buy French, Italian, New Zealand? It used to be


the case ten years ago, people said that, but there has been a big


change in people's perception towards English sparkling wine. I


think one of the reasons is the international competition results we


have had over the numbers of years where we have been pitted... The


best sound in the world! Pitted against some of the best sparkling


wines in the world and people recognise the quality is there now.


This is obviously sparkling wine, we just heard the pop, 95% of what you


produce is sparkling, why is that? We focus on predominantly sparkling


wine. Our climb it really is ideally suited for sparkling wine production


-- our climb it. We are able to fully ripe and the grapes but we are


able to maintain the acidity which is important for sparkling wine. You


mentioned the acidity, that used to be one of the stigmas attached to


English wine, it was too acidic. How have you approached that marketing


challenge of changing perception? It is about making the best possible


product we can. We have some exceptional vineyards and where we


are based in the south-east of England, in the Kent countryside,


the Garden of England, known for producing some of the best grapes


and fruit in the world. The climate is very similar to the wine


producing regions of, say, France. Very similar to northern France, in,


for example, Champagne. Sparkling wine is what we can compete on a


world level at. Has the weaker pound helps? We are seeing a lot of


appetite for our wines abroad, we are exporting to 14 different


countries. The falling pound is actually quite a good thing for us


going to export marks -- markets. Slightly distracted! The UK's


climate does not seem to naturally lend itself to some grapes that


would necessarily make a nice wine? For sparkling wine, we have the


perfect climate. If you were trying to make a blockbuster red wine, that


might be more challenging. But for more refined and elegant wines that


have a lovely vibrancy to them, our climate is perfect. I feel like it


would be rude not to. Cheers! Just to spoil the illusion, they are


plastic glasses, for safety, but still... That is lovely. That is why


you did not hear the clink. Lovely. Really smooth. Even at this time in


the morning, still lovely. Thanks very much.


We are also talking about artificial intelligence.


It has been accused of threatening everything from jobs


It's also being called the most important technology to come


along since electricity, and companies are racing


Microsoft has outlined a code of ethics.


Here's our technology correspondent Rory Cellan-Jones:


What if artificial intelligence could see your world and interpret


it for you? Microsoft engineer who is blind is showing me a new app


called seeing AI designed to help visually impaired people. As well as


reading text, it can tell him about the people in front of him, as


sometimes he gets it wrong. 50-year-old man looking happy. I am


getting younger by the minute! This is an application close to my heart


but the general AI is applicable in so many different ways. From around


the world, Microsoft scientists came to London to show off their


projects. Like this live translation system for presentations. Or


software which can search through hours of closed-circuit TV, as well


as staking a claim as a leader in this technology, the firm has come


up with ethical principles for AI. Microsoft believes we are creating


AI to amplify human ingenuity, not to compete with it. The human is the


hero. I want to endow you with superpowers. Microsoft is just one


of the tech giants battling to profit from advances in artificial


intelligence which are giving computers skills once restricted to


humans. They are learning to see, one example, driverless cars can see


exactly where they are going. They are learning to hear what we say to


respond to it. Amazon's Alexa can respond when we asked them to give


us the news or recommend a restaurant. They are even making


judgments. For instance, on whether a scan shows a malignant tumour. In


this battle over this crucial technology, Google and Facebook are


spending vast sums on research, but China refuses to be left behind.


Investing heavily to build robots who will take over from humans in


the vast factories. It looks like AI will transform the economy as it


transformed industries, potentially make us all wealthier and happier


and the companies who get their first will take the spoils, the


rewards. You have to come out loud and strong. Progress in artificial


intelligence has been more rapid in recent years than even the


scientists predicted and companies like Microsoft know they cannot


afford to fall behind. What other business stories have we got? Senior


currency strategist joins us once again. One we were picking out, the


article in the FT about EU regulators trying to clamp down on


prospective employers searching people's social media pages? The


story references the fact 60% of employers look at social media in


order to get a picture of the potential employee. What this says


is that they may not be able to do that. Certainly they should ask the


prospective employee for their permission. And even if the data is


public, they cannot assume they can use it for their own purposes. We


were asking people today to tweet on that topic, how would they feel? A


lot of responses. Thank you. Dale says, and intrusion of my privacy,


but the posts are in a public setting. Linda says, take a look if


you wish. Damian says, an invasion of privacy. Dave says, perfectly


happy, I only post things I would be happy to hear about myself on BBC


News. How would you feel? Is that something you feel is commonly


practised in the financial services? I know that the hiring process in


the financial services is very detailed. You have to fit a certain


type of person because of the regulator, the criminal potential in


the industry. I think the people again, this has just been mentioned,


that should be most concerned our young people who might perhaps be


doing foolish things, posting them on a chat site, and years later, it


comes back to home. I know that at some schools there are warnings


going out for the last few years, be careful what you post, these things


could be on there for ever and they might not do you good later on. You


do not think about that when you 14. Thank you very much. We will see you


soon. Thanks for watching. Quite a chilly start for some,


especially in rural areas. Largely dry and plenty of sunshine


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